Pub Date : 2023-06-18DOI: 10.1177/00157325231166237
N. Doan, Thanh Hà Lê
This article uses panel data with 6,743 country-year observations to investigate the effects of participation in the global value chain (GVC) on export survival rate for the period 2005–2014. GVC participation is measured as the value addition embedded in exports, looking both backward and forward from a reference country. The empirical results show that both backward and forward linkages have positive effects on the chance of export survival; these effects are persistent and increasing over time, and they become more pronounced when taking the endogeneity issue into account. On the policy front, the preceding findings suggest that governments should implement policies to upgrade a country to GVC integration in order to enhance the sustainability of exports. JEL Codes: F10, F14, C41
{"title":"The Effects of Global Value Chain on Export Survival","authors":"N. Doan, Thanh Hà Lê","doi":"10.1177/00157325231166237","DOIUrl":"https://doi.org/10.1177/00157325231166237","url":null,"abstract":"This article uses panel data with 6,743 country-year observations to investigate the effects of participation in the global value chain (GVC) on export survival rate for the period 2005–2014. GVC participation is measured as the value addition embedded in exports, looking both backward and forward from a reference country. The empirical results show that both backward and forward linkages have positive effects on the chance of export survival; these effects are persistent and increasing over time, and they become more pronounced when taking the endogeneity issue into account. On the policy front, the preceding findings suggest that governments should implement policies to upgrade a country to GVC integration in order to enhance the sustainability of exports. JEL Codes: F10, F14, C41","PeriodicalId":29933,"journal":{"name":"Foreign Trade Review","volume":null,"pages":null},"PeriodicalIF":1.3,"publicationDate":"2023-06-18","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"81047855","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2023-06-13DOI: 10.1177/00157325231166763
Moumita Basu, Rilina Basu, Ranjanendra Narayan Nag
The pandemic crisis and associated lockdown have led to diminution in demand on one hand and different types of supply side bottlenecks on the other. The article makes a theoretical attempt to assess macroeconomic dimensions of COVID-19 along with consequences of such crisis using a two-sector dependent economy model. In particular, the article investigates the implications of unanticipated adverse shock such as COVID-19 and wage cut for the dynamic interaction of Tobin’s q, price of non-traded goods and the exchange rate and sectoral composition of output and level of employment. The effects of expansionary fiscal policy and increase in risk premium are also highlighted as the part of concluding remarks. The results in this article critically depend on the difference in the speeds of adjustments in the Tobin’s q, exchange rate and price of non-traded goods and different types of cross effects emanating from changes in interconnected macroeconomic variables. While the pandemic crisis leads to contraction of all the sectors and decrease in level of employment in the short-run with uncertain medium-run implications, the wage cut somewhat arrests the fall in employment. JEL Codes: E24, F41, G12
{"title":"Understanding Pandemic Crisis in a Dependent Economy: A Structuralist Analysis","authors":"Moumita Basu, Rilina Basu, Ranjanendra Narayan Nag","doi":"10.1177/00157325231166763","DOIUrl":"https://doi.org/10.1177/00157325231166763","url":null,"abstract":"The pandemic crisis and associated lockdown have led to diminution in demand on one hand and different types of supply side bottlenecks on the other. The article makes a theoretical attempt to assess macroeconomic dimensions of COVID-19 along with consequences of such crisis using a two-sector dependent economy model. In particular, the article investigates the implications of unanticipated adverse shock such as COVID-19 and wage cut for the dynamic interaction of Tobin’s q, price of non-traded goods and the exchange rate and sectoral composition of output and level of employment. The effects of expansionary fiscal policy and increase in risk premium are also highlighted as the part of concluding remarks. The results in this article critically depend on the difference in the speeds of adjustments in the Tobin’s q, exchange rate and price of non-traded goods and different types of cross effects emanating from changes in interconnected macroeconomic variables. While the pandemic crisis leads to contraction of all the sectors and decrease in level of employment in the short-run with uncertain medium-run implications, the wage cut somewhat arrests the fall in employment. JEL Codes: E24, F41, G12","PeriodicalId":29933,"journal":{"name":"Foreign Trade Review","volume":null,"pages":null},"PeriodicalIF":1.3,"publicationDate":"2023-06-13","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"78078676","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2023-06-11DOI: 10.1177/00157325231173209
Carlos Chavez
This paper studies the effects of financial liberalisation on governability. The dependent variables measure governability in terms of control of corruption, government effectiveness, political stability, rule of law, regulatory quality and free speech for 125 countries from 1996 to 2019. As a variable measuring financial liberalisation, I use the Chinn-Ito index and Fernandez index as capital control measure. I use fixed-effects panel data, quantile regression, system GMM and event study to estimate these effects. The results I find show that the financial liberalisation has strong effects on those governability variables, especially low-income countries tend to have a higher sensitivity to changes in capital controls on governability and social stability, as well as countries in the 0.4–0.6 quantiles of the governability. Finally, I find that these effects take at least one year to become persistent over time. These findings imply that, in times of political turbulence and instability, governments may pursue liberalising policies that increase the dynamism of the economy to alleviate the climate of ungovernability. JEL Codes: F38, D72, P16
{"title":"Estimating the Effects of Financial Liberalisation on Governability and Social Stability","authors":"Carlos Chavez","doi":"10.1177/00157325231173209","DOIUrl":"https://doi.org/10.1177/00157325231173209","url":null,"abstract":"This paper studies the effects of financial liberalisation on governability. The dependent variables measure governability in terms of control of corruption, government effectiveness, political stability, rule of law, regulatory quality and free speech for 125 countries from 1996 to 2019. As a variable measuring financial liberalisation, I use the Chinn-Ito index and Fernandez index as capital control measure. I use fixed-effects panel data, quantile regression, system GMM and event study to estimate these effects. The results I find show that the financial liberalisation has strong effects on those governability variables, especially low-income countries tend to have a higher sensitivity to changes in capital controls on governability and social stability, as well as countries in the 0.4–0.6 quantiles of the governability. Finally, I find that these effects take at least one year to become persistent over time. These findings imply that, in times of political turbulence and instability, governments may pursue liberalising policies that increase the dynamism of the economy to alleviate the climate of ungovernability. JEL Codes: F38, D72, P16","PeriodicalId":29933,"journal":{"name":"Foreign Trade Review","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2023-06-11","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"136369635","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2023-06-11DOI: 10.1177/00157325231166456
Muhammad Uzair Ali, Y. Wang
Studying the impact of global value chains’ (GVCs) participation degrees on carbon emission transfer through international trade (CTIT) in Belt and Road Initiative (BRI) economies is of great significance because these economies are significant participants of GVCs and international trade. The current study, through the inter-regional Input-Output table, calculated the GVCs’ participation degrees (forward and backward participation) and CTIT (carbon emission transfer through export (ETET) and emission transfer through import [ETIT] trade) of 27 BRI economies from 2005 to 2018 and investigated the impact of the GVCs on CTIT. Several test results illustrated that endogenous issues did not affect the robustness of study discussions. The study articulates appropriate environmental governance policies that could realise emissions reduction goals. Significant results are (a) participation degree in GVCs increases the CTIT in BRI; (b) energy intensity, energy structure, final demand and secondary industry escalate CTIT; (c) the optimisations of participation degree in GVCs, energy intensity development, industrial structure optimisation and increased awareness of emission lessening among the BRI community could compensate for the growth in CTIT from the constant deepening of GVCs. This study delivers a comprehensive insight into understanding the driving forces that cause the changes in CTIT from the GVCs’ perspective. JEL Codes: F02, F18, Q56
{"title":"Does the Participation Degree in Global Value Chains Influence Carbon Emission Transfer Through International Trade in Belt and Road Countries?","authors":"Muhammad Uzair Ali, Y. Wang","doi":"10.1177/00157325231166456","DOIUrl":"https://doi.org/10.1177/00157325231166456","url":null,"abstract":"Studying the impact of global value chains’ (GVCs) participation degrees on carbon emission transfer through international trade (CTIT) in Belt and Road Initiative (BRI) economies is of great significance because these economies are significant participants of GVCs and international trade. The current study, through the inter-regional Input-Output table, calculated the GVCs’ participation degrees (forward and backward participation) and CTIT (carbon emission transfer through export (ETET) and emission transfer through import [ETIT] trade) of 27 BRI economies from 2005 to 2018 and investigated the impact of the GVCs on CTIT. Several test results illustrated that endogenous issues did not affect the robustness of study discussions. The study articulates appropriate environmental governance policies that could realise emissions reduction goals. Significant results are (a) participation degree in GVCs increases the CTIT in BRI; (b) energy intensity, energy structure, final demand and secondary industry escalate CTIT; (c) the optimisations of participation degree in GVCs, energy intensity development, industrial structure optimisation and increased awareness of emission lessening among the BRI community could compensate for the growth in CTIT from the constant deepening of GVCs. This study delivers a comprehensive insight into understanding the driving forces that cause the changes in CTIT from the GVCs’ perspective. JEL Codes: F02, F18, Q56","PeriodicalId":29933,"journal":{"name":"Foreign Trade Review","volume":null,"pages":null},"PeriodicalIF":1.3,"publicationDate":"2023-06-11","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"75378420","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2023-06-11DOI: 10.1177/00157325231158840
Asmita Das, Damayanti Sau, Ranjanendra Narayan Nag
The article makes a theoretical attempt to explain how different interconnected measures of globalisation—service led growth, tariff reform, agricultural trade liberalisation and capital account liberalisation—affect the skilled–unskilled wage disparity, sector-wise performance, income distribution and aggregate welfare of the economy. We pay attention to land augmenting technological progress as an essential ingredient of inclusive growth and discuss effects of COVID-19 as a supply shock. In so-doing, we construct a three-sector general equilibrium framework with an export-oriented service sector, a tariff-protected import competing manufacturing sector and an export-oriented traded agricultural sector. We find that service-led growth and tariff liberalisation shifts the income distribution in favour of the landed gentry and skilled labour. Agricultural trade liberalisation and capital account liberalisation also debilitate the income distribution. Land augmenting technological progress adversely impacts the manufacturing sector but benefits the other sectors. Following the outbreak of the pandemic, a fall in labour endowment and rise in transaction costs were observed. A decrease in the endowment of skilled labour reduces the production in service sector and increases the production of the manufactured commodity. The results are reversed when the endowment of unskilled labour decreases. An increase in transaction produces unfair outcome from the perspective of income distribution. In this context it becomes imperative to mention that, the construction of the three-sector general equilibrium framework is not new, and that the effects of the COVID-19 pandemic cannot be reduced to just a supply shock. COVID-19 has elements of both supply shock and demand shock, but in this article, we address supply side dimensions of COVID shock in conjunction with the effects of lockdown. In addition, we also demonstrate the robustness of our results to an alternate assumption on the structure of the model. JEL Codes: D50, F66, J31
{"title":"Globalisation, COVID-19 and Income Distribution: A Theoretical Evaluation","authors":"Asmita Das, Damayanti Sau, Ranjanendra Narayan Nag","doi":"10.1177/00157325231158840","DOIUrl":"https://doi.org/10.1177/00157325231158840","url":null,"abstract":"The article makes a theoretical attempt to explain how different interconnected measures of globalisation—service led growth, tariff reform, agricultural trade liberalisation and capital account liberalisation—affect the skilled–unskilled wage disparity, sector-wise performance, income distribution and aggregate welfare of the economy. We pay attention to land augmenting technological progress as an essential ingredient of inclusive growth and discuss effects of COVID-19 as a supply shock. In so-doing, we construct a three-sector general equilibrium framework with an export-oriented service sector, a tariff-protected import competing manufacturing sector and an export-oriented traded agricultural sector. We find that service-led growth and tariff liberalisation shifts the income distribution in favour of the landed gentry and skilled labour. Agricultural trade liberalisation and capital account liberalisation also debilitate the income distribution. Land augmenting technological progress adversely impacts the manufacturing sector but benefits the other sectors. Following the outbreak of the pandemic, a fall in labour endowment and rise in transaction costs were observed. A decrease in the endowment of skilled labour reduces the production in service sector and increases the production of the manufactured commodity. The results are reversed when the endowment of unskilled labour decreases. An increase in transaction produces unfair outcome from the perspective of income distribution. In this context it becomes imperative to mention that, the construction of the three-sector general equilibrium framework is not new, and that the effects of the COVID-19 pandemic cannot be reduced to just a supply shock. COVID-19 has elements of both supply shock and demand shock, but in this article, we address supply side dimensions of COVID shock in conjunction with the effects of lockdown. In addition, we also demonstrate the robustness of our results to an alternate assumption on the structure of the model. JEL Codes: D50, F66, J31","PeriodicalId":29933,"journal":{"name":"Foreign Trade Review","volume":null,"pages":null},"PeriodicalIF":1.3,"publicationDate":"2023-06-11","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"85253610","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2023-05-11DOI: 10.1177/00157325231159240
N. Upadhayay
Foreign aid, in theory, is expected to mitigate constraints that impede the economic development of recipient countries. At the same time that help is committed, donors are seemingly taking actions that are harmful to developing economies in obvious ways. An example is the tacit circumvention of the putative rules-based global trading system through contingent protection activities. In this article, it is postulated that, on one hand aid-for-trade (AfT) is expected to have positive impact on the exports of aid recipients by better integration into the global trading order, on the other hand, aid provider (donor) curtails access to its own markets by actuating contingent protection against the recipient (exporter). Using contingent protection cases data from 2003 to 2018 (a 15-year period) against 106 recipient countries of the United States of America’s AfT, this study finds a significant and positive impact of AfT on the surge in contingent protection activities. This effect is entirely driven by the aid for economic infrastructure and services, while the other main category of AfT- production sector, has no discernible effect on the rise in protection against the recipient. To examine the heterogeneity in donor decisions, this study is expanded to other traditional donors like Australia, Canada, the European Union (EU) and New Zealand. This article finds that Australia behaves similar to the USA; however, for Canada and the EU, the relationship between aid and market access is not statistically significant. JEL Codes: F1, F35, O19
{"title":"The Link Between Aid-for-Trade and Contingent Protection","authors":"N. Upadhayay","doi":"10.1177/00157325231159240","DOIUrl":"https://doi.org/10.1177/00157325231159240","url":null,"abstract":"Foreign aid, in theory, is expected to mitigate constraints that impede the economic development of recipient countries. At the same time that help is committed, donors are seemingly taking actions that are harmful to developing economies in obvious ways. An example is the tacit circumvention of the putative rules-based global trading system through contingent protection activities. In this article, it is postulated that, on one hand aid-for-trade (AfT) is expected to have positive impact on the exports of aid recipients by better integration into the global trading order, on the other hand, aid provider (donor) curtails access to its own markets by actuating contingent protection against the recipient (exporter). Using contingent protection cases data from 2003 to 2018 (a 15-year period) against 106 recipient countries of the United States of America’s AfT, this study finds a significant and positive impact of AfT on the surge in contingent protection activities. This effect is entirely driven by the aid for economic infrastructure and services, while the other main category of AfT- production sector, has no discernible effect on the rise in protection against the recipient. To examine the heterogeneity in donor decisions, this study is expanded to other traditional donors like Australia, Canada, the European Union (EU) and New Zealand. This article finds that Australia behaves similar to the USA; however, for Canada and the EU, the relationship between aid and market access is not statistically significant. JEL Codes: F1, F35, O19","PeriodicalId":29933,"journal":{"name":"Foreign Trade Review","volume":null,"pages":null},"PeriodicalIF":1.3,"publicationDate":"2023-05-11","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"73733872","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2023-04-15DOI: 10.1177/00157325231158855
Lingaraj Mallick, S. Behera, Mita Bhattacharya
In this research, we investigate the dynamic relationship between the trade balance and exchange rate in the case of India using threshold cointegration and an asymmetric error-correction model. Empirical results validate that the long-run dynamic relationship between the trade balance and exchange rates is asymmetric. In the short run, the trade balance responds only due to positive deviations in the exchange rate. In contrast, in the exchange rate model, the exchange rate reacts only due to negative deviations in the trade balance. In addition, the results exhibit that the adjustment following variation in the exchange rate seems higher than the adjustment in the trade balance in the short run. Besides, the results indicate that the speed of adjustment due to the positive and negative shocks differs in the trade balance and the exchange rate models. Further, the uni- directional Granger causality result suggests that the trade balance substantially affects the exchange rate. However, the Granger causality effect of the exchange rate on the trade balance seems minimal. Finally, our results validate the impact of momentum equilibrium adjustment path asymmetric effects between the trade balance and exchange rate, indicating that the adjustment path is asymmetric in the long run. Therefore, policy planners in India should consider the asymmetric adjustment between these two drivers to overcome trade balance discrepancies in the short and long run. JEL Codes: F40, F41, C22, C32, C12
{"title":"Impact of Exchange Rate on Trade Balance of India: Evidence from Threshold Cointegration with Asymmetric Error Correction Approach","authors":"Lingaraj Mallick, S. Behera, Mita Bhattacharya","doi":"10.1177/00157325231158855","DOIUrl":"https://doi.org/10.1177/00157325231158855","url":null,"abstract":"In this research, we investigate the dynamic relationship between the trade balance and exchange rate in the case of India using threshold cointegration and an asymmetric error-correction model. Empirical results validate that the long-run dynamic relationship between the trade balance and exchange rates is asymmetric. In the short run, the trade balance responds only due to positive deviations in the exchange rate. In contrast, in the exchange rate model, the exchange rate reacts only due to negative deviations in the trade balance. In addition, the results exhibit that the adjustment following variation in the exchange rate seems higher than the adjustment in the trade balance in the short run. Besides, the results indicate that the speed of adjustment due to the positive and negative shocks differs in the trade balance and the exchange rate models. Further, the uni- directional Granger causality result suggests that the trade balance substantially affects the exchange rate. However, the Granger causality effect of the exchange rate on the trade balance seems minimal. Finally, our results validate the impact of momentum equilibrium adjustment path asymmetric effects between the trade balance and exchange rate, indicating that the adjustment path is asymmetric in the long run. Therefore, policy planners in India should consider the asymmetric adjustment between these two drivers to overcome trade balance discrepancies in the short and long run. JEL Codes: F40, F41, C22, C32, C12","PeriodicalId":29933,"journal":{"name":"Foreign Trade Review","volume":null,"pages":null},"PeriodicalIF":1.3,"publicationDate":"2023-04-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"87327779","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2023-04-03DOI: 10.1177/00157325221145397
Ademola Obafemi Young
Two opposite strands of literature analysing export diversification’s role in promoting sustainable growth have evolved in international economics and development, namely, the intensive and extensive margins of exports. This study empirically investigates which of the margin is more useful towards promoting sustainable growth using annual time series data of Nigeria for the period 1960–2021. Autoregressive distributed lag (ARDL) and innovative accounting procedure were employed. The ARDL results reveal that both margins significantly enhance growth in short and long run. However, importance of the extensive margin, in aggregate, dominates that of the intensive margin. Likewise, the results from innovative accounting procedures reveal that although both margins contribute positively to growth, the contribution to growth of extensive margin dominates over that of the intensive margin. These results, thus, lend credence to the extensive-margin exposition, which postulates that the export of extant commodities to new market destinations or export of new commodities to new and/or old market destinations plays a relatively more important role in export growth/diversification and, ultimately, sustainable growth. The study recommends that governments should develop and implement economic policies aimed at enhancing exports of value-added commodities—due to their relatively high income and price elasticities over primary commodities—to maximise the benefits in the extensive margin. JEL Codes: F10, F14, O10, O12, O50, O55
{"title":"Intensive and Extensive Margins of Export Diversification as Strategies for Sustainable Economic Growth: Evidence from the Nigerian Economy","authors":"Ademola Obafemi Young","doi":"10.1177/00157325221145397","DOIUrl":"https://doi.org/10.1177/00157325221145397","url":null,"abstract":"Two opposite strands of literature analysing export diversification’s role in promoting sustainable growth have evolved in international economics and development, namely, the intensive and extensive margins of exports. This study empirically investigates which of the margin is more useful towards promoting sustainable growth using annual time series data of Nigeria for the period 1960–2021. Autoregressive distributed lag (ARDL) and innovative accounting procedure were employed. The ARDL results reveal that both margins significantly enhance growth in short and long run. However, importance of the extensive margin, in aggregate, dominates that of the intensive margin. Likewise, the results from innovative accounting procedures reveal that although both margins contribute positively to growth, the contribution to growth of extensive margin dominates over that of the intensive margin. These results, thus, lend credence to the extensive-margin exposition, which postulates that the export of extant commodities to new market destinations or export of new commodities to new and/or old market destinations plays a relatively more important role in export growth/diversification and, ultimately, sustainable growth. The study recommends that governments should develop and implement economic policies aimed at enhancing exports of value-added commodities—due to their relatively high income and price elasticities over primary commodities—to maximise the benefits in the extensive margin. JEL Codes: F10, F14, O10, O12, O50, O55","PeriodicalId":29933,"journal":{"name":"Foreign Trade Review","volume":null,"pages":null},"PeriodicalIF":1.3,"publicationDate":"2023-04-03","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"80044251","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2023-04-03DOI: 10.1177/00157325221142652
Terver Kumeka, I. Raifu, O. Adeniyi
This study examines the relationship between globalisation and inclusive growth by considering the modulating role of institutional quality. To achieve our broad objective, we use data from 45 African economies over 1996–2018 to determine the panel cointegration and cointegrating regression association between inclusive growth, globalisation and institutional quality. To determine a suitable estimation technique for the empirical analysis, several pre-estimation tests were conducted. After confirming the existence of cointegration and slope heterogeneity, we adapted the long-run panel cointegrating methods—the fully modified ordinary least squares and dynamic ordinary least squares estimations. The results from both show that aggregate globalisation and its various dimensions have positive and significant effects on inclusive growth. Besides the direct positive impact on inclusive growth, globalisation has indirect positive and significant impact on inclusive growth through institutional quality. Finally, some policy implications are highlighted. JEL Codes: E02, F62, F63, O15, O43
{"title":"Globalisation and Inclusive Growth in Africa: The Role of Institutional Quality","authors":"Terver Kumeka, I. Raifu, O. Adeniyi","doi":"10.1177/00157325221142652","DOIUrl":"https://doi.org/10.1177/00157325221142652","url":null,"abstract":"This study examines the relationship between globalisation and inclusive growth by considering the modulating role of institutional quality. To achieve our broad objective, we use data from 45 African economies over 1996–2018 to determine the panel cointegration and cointegrating regression association between inclusive growth, globalisation and institutional quality. To determine a suitable estimation technique for the empirical analysis, several pre-estimation tests were conducted. After confirming the existence of cointegration and slope heterogeneity, we adapted the long-run panel cointegrating methods—the fully modified ordinary least squares and dynamic ordinary least squares estimations. The results from both show that aggregate globalisation and its various dimensions have positive and significant effects on inclusive growth. Besides the direct positive impact on inclusive growth, globalisation has indirect positive and significant impact on inclusive growth through institutional quality. Finally, some policy implications are highlighted. JEL Codes: E02, F62, F63, O15, O43","PeriodicalId":29933,"journal":{"name":"Foreign Trade Review","volume":null,"pages":null},"PeriodicalIF":1.3,"publicationDate":"2023-04-03","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"86482103","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2023-04-01DOI: 10.1177/00157325221145452
S. Edo
In the last four decades, sub-Saharan African countries have witnessed a substantial increase in trade openness and sovereign debt (foreign public debt and domestic public debt). The direct and interactive effects of these factors on economic growth are investigated in this study. The investigation covers the period 1980–2020 and employs the generalised method of moment methodology. The estimation results reveal that the direct effect of trade openness and domestic public debt is significantly favourable. The direct effect of foreign public debt is, however, found to be unfavourable. The results also reveal that the interactive effect of trade openness and domestic public debt is significantly favourable, whereas the interactive effect of trade openness and foreign public debt is fairly favourable. The estimation results thus imply that trade openness and sovereign debt are complementary drivers of economic growth in sub-Saharan African countries. In spite of the favourable role of trade openness and sovereign debt, economic growth has yet to achieve the desired level, which does not augur well for employment and welfare. The prospects of growth could be enhanced by strengthening the impact of trade openness and sovereign debt. However, policy makers should be aware of the direct negative impact of foreign public debt on economic growth, and the need to put measures in place to manage it. JEL Codes: F23, H63, F43, O55
{"title":"Comparative Performance of Trade Openness and Sovereign Debt Accumulation in Fostering Economic Growth of Sub-Saharan African Countries","authors":"S. Edo","doi":"10.1177/00157325221145452","DOIUrl":"https://doi.org/10.1177/00157325221145452","url":null,"abstract":"In the last four decades, sub-Saharan African countries have witnessed a substantial increase in trade openness and sovereign debt (foreign public debt and domestic public debt). The direct and interactive effects of these factors on economic growth are investigated in this study. The investigation covers the period 1980–2020 and employs the generalised method of moment methodology. The estimation results reveal that the direct effect of trade openness and domestic public debt is significantly favourable. The direct effect of foreign public debt is, however, found to be unfavourable. The results also reveal that the interactive effect of trade openness and domestic public debt is significantly favourable, whereas the interactive effect of trade openness and foreign public debt is fairly favourable. The estimation results thus imply that trade openness and sovereign debt are complementary drivers of economic growth in sub-Saharan African countries. In spite of the favourable role of trade openness and sovereign debt, economic growth has yet to achieve the desired level, which does not augur well for employment and welfare. The prospects of growth could be enhanced by strengthening the impact of trade openness and sovereign debt. However, policy makers should be aware of the direct negative impact of foreign public debt on economic growth, and the need to put measures in place to manage it. JEL Codes: F23, H63, F43, O55","PeriodicalId":29933,"journal":{"name":"Foreign Trade Review","volume":null,"pages":null},"PeriodicalIF":1.3,"publicationDate":"2023-04-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"73100804","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":0,"RegionCategory":"","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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